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Battle Over the Airwaves: Principles for Spectrum Policy Reform

Policy Paper

Sept. 1, 2001

Today the American people collectively own the most valuable resource in the emerging information economy: the airwaves, also known as the electromagnetic spectrum. Auctions conducted last year in Europe and early this year in the U.S. suggest that spectrum occupied by commercial licensees has a market value well in excess of $300 billion. Unfortunately, while high bids by wireless phone companies should be a boon to the ordinary citizens who own the airwaves, high prices also evidence a policy-induced spectrum shortage that threatens to delay the widespread availability and affordability of wireless broadband services.

The four principles that should guide Congress and the FCC in reforming spectrum policy can be summarized as follows:

The airwaves are a public asset owned in common by all Americans.

All commercial licensees should pay a market-based rent for use of spectrum.

Rigid “zoning” of the airwaves should be replaced by a more flexible, marketdriven allocation process.

Revenue from licensing spectrum should be reinvested in new public assets that benefit all Americans and update our educational technology and public media for the digital age.

For the complete documents (the complete Working Paper version, as well as the more compact Issue Brief), please see the attached PDF files.